An enraged Singaporean by the name of Lua Eng Chuan has written to the Straits Times Forum demanding that PRs be banned from selling their HDB flats at a profit.
Mr. Lua’s response is to remarks made by Law Minister K. Shanmugam yesterday about foreigners being falsely accused of driving up costs. Mr. Lua criticized him for his failure to address “the consequences on single Singaporeans or offer more effective ways to help all citizens.”
“In dismissing the perceived impact of foreigners, Mr. Shanmugam noted that foreigners cannot buy HDB flats and that there are too few permanent residents (PRs) to affect prices. He also noted that the Government gives Singaporeans a leg up with concessionary loans and housing grants, and is ready to launch up to 12,000 build-to-order (BTO) units to meet demand. But concessionary loans and housing grants are not enough to offset rising flat prices, and single Singaporeans cannot buy BTO units,” he added.
Although HDB flats are supposedly public housing for Singapore citizens only, PRs are allowed to avail resale flats and later sell them at a profit with no restrictions imposed.
Currently, there are around 500,000 PRs in Singapore.
Home Affairs Minister Wong Kan Seng said that two out of every three PR applicants are successful, an amazingly high rate for a developed nation.
Due to the liberal immigration policies of the ruling party, foreigners, particularly those from India and mainland China, now account 36 percent of the population, up from 14 percent in 1990.
The persistent influx of foreigners from 2005 to 2008 concurred with the increase in the prices of HDB flats.
Singaporeans have no choice but to purchase them from the resale market or directly from HDB, as public housing is a basic necessity in Singapore, which HDB enjoys an absolute monopoly.
The prices of resale HDB flats hit an all-time high in June 2009 and continues to climb.
Propex CEO Mohammad Ismail revealed in an interview a few weeks ago that PRs accounted for 20 percent of resale flats buyers at his agency, a figure which contradicts the assertion of Mr. Shanmugam about PRs forming only a small percentage of the buyers.
Mr. Lua ended his letter with a suggestion to Mr. Shanmugam.
“PRs should also be banned from renting out their flats or putting them up for resale at a profit. The price at which PRs resell their flats should not be higher than what they paid for them.”
“Such a rule will prevent PRs who do not intend to take up citizenship from reaping a windfall when they return home after a few years. It will indeed ensure that foreigners are not responsible for high flat prices.”